Well, first off, I don't think WoW made wacky armor "mainstream." Technically, I think that honor goes more to JRPGs which started the trend of giving characters outrageous outfits. WoW's problem, and probably the problem with most serial fantasy games, is that as the games progress and armor sets that looked both fantastic and at least mildly functional become obsolete, you have to make the armor look more and more fantastic, otherwise people begin to complain. As others have said, armor and weapons are some of the clearest identifiers of progression in a game.
Furthermore, video games in general have gotten away with some really outrageous weapon and armor ideas over the years. Many times, this was done out of necessity; graphics could only go so far, and typically failed at portraying realistic human features, so they had to be masked behind brightly-colored, extravagant armor. As this turned into the norm, these extravagant armors had to be converted into better and better graphics, at which point I suppose the Uncanny Valley sort of steps in, as this thread has undoubtedly revealed.
Unfortunately, I don't really see how things like armor and weapons could go back to being simple. Now, granted, I wouldn't mind a game where, instead of gaining spikes and mass, armor simply gained designs, like special runes or spells etched into the armor to increase the effectiveness. But honestly, you're never going to have a game where the final armor isn't some ornamental mess, because if you don't have something pretty to show for all your effort, there will undoubtedly be a LOT of gamers who end up disappointed with the game.